Cities reap benefits by going green
by Matthew E. Kahn
Green cities are a key engine of economic growth in the modern skills economy.
In the 19th century, dead horses littered the streets of New York City and thousands of tenement dwellers were exposed to stinking water, smoky skies and ear-shattering din. The skies above such major cities as Chicago and Pittsburgh were dark with smoke from steel smelters, heavy industrial plants and burning coal. Around the world, similar quality-of-life challenges were observed.
Over time, many major cities in the developed world have experienced sharp improvements in quality of life. In Los Angeles, there has been a dramatic reduction in local ambient air pollution. The number of days per year exceeding the federal one-hour ozone standard declined from about 150 days per year at the worst locations during the early 1980s, to 20 to 30 days per year today.
Air, water and noise pollution have sharply fallen in many major U.S. cities. While there are several causes for this progress, the net result is that the "production cities" of the past are transforming themselves into "consumer cities" where people want to live and play. Urban greenness enhances such experiences and makes such cities even more desirable.
Many of us have an intuitive sense of what sets a green city, such as Portland, Ore., apart from "brown" urban centers like Mexico City. Green cities have clean air and water and pleasant streets and parks. Green cities are resilient in the face of natural disasters, and the risk of major infectious disease outbreaks is low. Green cities also encourage green behavior, such as the use of public transit.
Green cities are a key engine of economic growth in the modern skills economy. Living and working close to the Pacific Ocean does not cause one to be smarter and more productive. Instead, green amenities select and attract the skilled, resulting in robust economic growth. Human capital, it is widely agreed, is the key determinant of growth.
There is no free lunch, however. A city that pursues greenness as an economic development strategy will experience gentrification. One consequence of this trend will be rising home prices that squeeze out poorer renters, new immigrants and even the middle class, compelling them to live farther from the city center or migrate to a cheaper city.
In 2007, is Los Angeles a green city? Optimists would point to the high day-to-day quality of life in our city and the sharp progress in urban smog achieved over the last 30 years. Pessimists would counter that the region's greenhouse gas production has increased as Los Angeles County's population grew by 29% from 1980 to 2000 and total automobile mileage grew by 70%.
As an economist, I would say that Los Angeles could be an even greener city if it could offer incentives to polluters to mitigate their production of greenhouse gases. The rise in fuel-efficient vehicles and buildings certified by the nationally recognized Leadership in Energy and Environmental Design (LEED) rating system suggests that free market capitalism can help to reduce the threat of climate change without sacrificing our material standard of living.
Published: Tuesday, May 22, 2007